The FCA Thinks Your Clients Are Getting Financial Advice from ChatGPT. Here's Why That Should Matter to Every Adviser.

Fewer than one in ten UK adults get regulated financial advice. But nearly one in five investors now turn to social media for help with financial decisions. And according to the FCA's latest Perimeter Report, published on 26 March 2026, a growing number of consumers are using general-purpose AI tools like ChatGPT and Claude to guide their financial choices.

The FCA's position is clear: these tools sit outside the regulatory perimeter. Consumers using them aren't receiving regulated advice. They don't have access to the Financial Ombudsman Service. They aren't covered by the Financial Services Compensation Scheme. They're on their own.

That should concern every adviser in the UK. Not because AI is a competitor, but because of what it tells us about the gap between demand for financial help and the supply of affordable, accessible advice.

The advice gap, made visible

The FCA has been talking about the advice gap for years. The Advice Guidance Boundary Review, the targeted support regime, the new Simplified Advice consultation (CP26/10), all of it is trying to solve the same problem: millions of people need help with their money and aren't getting it.

AI didn't create the gap. But it's filling it by default. When someone asks ChatGPT whether they should consolidate their pensions, that's not a technology story. It's a distribution story. They couldn't find help they could afford, so they went to the thing that was free and available at 11pm on a Tuesday.

The Mills Review, led by the FCA's Sheldon Mills, is now examining how AI could reshape retail financial services by 2030 and beyond. The Treasury Select Committee has gone further, recommending that the FCA publish comprehensive guidance on AI in financial services by the end of 2026. The direction of travel is clear: the regulator is paying attention.

What this means for advice firms

For most IFA firms, AI isn't going to replace what you do. The complex, holistic, relationship-driven work of financial planning isn't something a chatbot replicates well. Pension consolidation with multiple defined benefit schemes, inheritance tax planning across generations, divorce settlements, these require judgement, context and trust.

But there's a different question worth asking: are there parts of your process where clients are waiting too long, repeating information too many times, or struggling to get basic updates? Because that's where people drift toward AI tools. Not for the complex stuff, but for the simple stuff that feels harder than it should.

The firms that will benefit most from this shift are the ones that can serve more clients without burning out their advisers. That means better systems for client communication, better data capture during onboarding, better visibility across the pipeline so nothing gets missed.

It also means being honest about capacity. If your firm can't take on new clients because every adviser is at full stretch servicing existing ones, then the advice gap isn't just an industry problem. It's your problem too.

The opportunity, not the threat

The FCA's Perimeter Report isn't a warning to advisers. It's a signal. Consumer demand for financial help is real, growing, and increasingly being met by unregulated tools. That creates an opportunity for firms who can scale their reach without compromising quality.

Technology plays a role here, but not as a replacement for advice. The value is in the infrastructure around it: client portals that reduce admin, automated workflows that free up adviser time, CRM systems that keep client relationships warm even between annual reviews.

The firms that treat technology as a way to create capacity, rather than cut costs, will be the ones that close their own version of the advice gap. One client at a time.